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In the present business scenario, those organizations which have been able to integrate their business strategies with advanced information technology or information system have benefitted significantly in terms of business returns. Implementation of information technology in the functioning of the company acts as a driver of business strategies in different functional areas such as competitive differentiation, customization, process automation and improvement, and quality improvement.
Most of the top level managers of different organizations believe that, to remain competitive and to get edge over others, it is very important to align information technology with business technology. Information technology services and solution providers are acting as a change agent and are adding value to the firms by enhancing their efficiency and effectiveness. Studies by many scholars on information technology and business strategy alignment have concluded that there exists relationship among information technology, competitive strategy and performance (Smaczny, 2001).
The main reason behind aligning business strategies and information technology is to take benefits from the features of information technology that contributes towards the successful operations of the enterprise. An organization is considered to be successfully aligned its business strategies with the information technology when:
In order to achieve alignment of information technology and business strategies, it is very important that organizations must insure the completion of four basic steps. These four steps are:
Once the organization has successfully aligned information technology with the business strategies, it will enable the organization in the following ways:
Thus, in the present business environment it is very important for the organizations to attain alignment if information technology with business strategies. The companies can achieve this by understanding the importance of the alignment of information technology with business strategies and partnering with some information technology service provider. Further, it must start giving some control regarding information system to the business. Moreover, implementing information technology related decisions will also make organizations to understand its necessity. Further, in order to achieve appropriate alignment, the firm must need to create an effective process that will enable the business to maintain alignment with the information technology and the business will have to align its style, structure, skills, staffing, etc with the information technology so as to match the organization’s requirement (Haes and Grembergen, 2009).
Aligning information technology with business strategies enables the organization to maintain proper balance between the capabilities of the organization and the scare resources available to it. Further, it also helps the organizations to analyze the opportunities and risks present in the environment and thus, guide it to reach to its goals. It enables the organization to match what it can do with what it might do (Gregor, Hart and Martin, 2007)
This section of the report will focus on highlighting the needs and possible uses & benefits of alignment information technology with the business strategies. According to the positivism views of majority of the users, here are some of the major benefits that aliment can deliver to the company:
So, from the above discussion it is clear that the scope of alignment of information technology with business strategies is very wide in any organizations and provides tremendous edge to the company over its competitors. Contradictory to the above discussion, some of people feel that alignment of IT with business strategies do not provide any advantage to the company.
According to them, this alignment requires lot of time and money, and instead spending time and money on this, companies must try to focus on customer satisfaction. Moreover, many of the big corporation keeps on adding or changing their business model, so it becomes necessary for them to every time change the IT architecture, which is not easy for some of the companies. In addition to this, skilled force is required to successfully integrate the IT with the business, and thus further add to the cost. So they feel, in the time of cost cutting, it is not necessary for the businesses to integrate IT with Business (Schwalbe, 2010).
Considering both the positive and negative arguments about the alignment of IT with business strategies clarifies that, in the present technological era, it is essential for the companies to align information with business strategies, as in comparison to its drawbacks, its benefits adds more value to the firm. Further, it also enables the company optimal utilization of limited skills and scare resources.
Earlier, management does not use to provide proper attention on the implementation of information technology in the firm as they were considered as supportive activities. But, with the passage of time, management of almost all the firms have significantly changed their opinion about the aligning information technology with the business strategies. Earlier, when the management does not have idea about the benefits the information system can provide to their organization, they considered it as an unnecessary expense and believed that it is not necessary for the company to invest in such technologies as they do not provide value for money benefits. But, later on their perception changed about the alignment of information system with business strategies and they considered it as a business driver (Papp, 2001). The below shown information technology and business alignment matrix will further cement the fact that alignment of information technology results in value addition to the company.
Any organization which fails to strategically align information technology with its business strategies has to face consequences related to losing opportunity and financial cost. Apart from this, it will have to face many other misshapes also such as:
After discussing the topic ‘alignment of information technology with business strategies’ it can be concluded that to manage the limited skills and scare resources, it is very important for an organization to integrate and align information technology with its business strategies. It will enable the company to recognize lead indicators and the firm will become proactive rather than reactive.
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